Page 148 - RusRPTJan21

marketing information to its quarterly financial releases.
9.2.2 ​Automotive corporate news
The sales of Russia’s largest car maker AvtoVAZ will fall by around 7% in 2020, but the company will have a minimal net profit, ​state industrial corporation Rostec CEO Sergei Chemezov told reporters on Monday. “Since July, their sales have been growing every month – this partially compensates for the spring losses. We expect the year to be profitable, but of course, the company is unlikely to achieve the same profit as in 2019. The drop in sales will be about 7%. That is, there will be some profit, but minimal,” Chemezov said. Overall car sales in Russia will decrease by 10–15% this year, he added. “This is a difficult year, and this concerns not only AvtoVAZ, but all manufacturers of passenger cars and trucks too. The market experienced a serious drop in the spring months. Overall, I think that the market will fall on average by 10–15%,” he said. Chemezov also said that Rostec plans to write off the remaining RUB20bn ruble debt of AvtoVAZ
9.2.3​ Aviation corporate news
Aeroflot released its 3Q20 IFRS results yesterday and held a conference call.
Russia's domestic aviation market has been one of the fastest to recover globally. In fact, 3Q20 was already quite close to 3Q19 in terms of domestic traffic. Importantly, Pobeda managed to capitalize on that recovery: its 3Q20 traffic was up 12.1% y/y, while October traffic was up 10.6%. Pobeda managed to post R3.65bn in net income in 3Q20. Its net income is even positive over 9m20, which is an exceptional indicator in the current circumstances in the aviation segment. As the recovery in the domestic market was taking place amid massive overcapacity in the industry, the domestic yield decreased by 16.8% y/y in 3Q20. In 4Q20, meanwhile, Aeroflot is seeing negative dynamics versus 3Q20, which is attributable not only to the tighter restrictions amid the second wave of the virus but also by the seasonal pattern. The company has responded by once again optimizing capacity, thus trying to limit the cash burn.
In terms of international destinations, robust demand has been seen for those destinations that have opened (Turkey is the main destination in terms of weekly flights). Moreover, because the number of destinations is really limited, the international yield deviated from the domestic one, reaching 68% y/y growth in ruble terms.
As for the 2021 outlook, Aeroflot currently expects that in April the
148 ​RUSSIA Country Report​ January 2021 www.intellinews.com